Review by Angel Broking...!
Company background
RHFL, a south based housing finance company, was established in
April 2000 as a
wholly owned subsidiary of Repco Bank. The company is primarily
engaged in the
business of individual home loans and loans against property,
which as of
1HFY2013 accounts for 85. 6% and 14.4 % of its loan book
respectively.
As of December 31, 2012, it had a total of 73 branches and 19
satellite centers located
in Tamil Nadu, Karnataka, Andhra Pradesh, Kerala, Maharashtra,
Odisha, West
Bengal, Gujarat and the Union Territory of Pondicherry.
In December 2007, the company raised funds to the tune of Rs. 76 cr from Carlyle
group, a global alternative asset manager and by virtue of which
Carlyle group
acquired 49.9 % stake in the company.
Recently, Carlyle group has transferred 26.2 % of the total
equity shares to Creador 1 LLC, WCP Holdings III and certain other entities;
and hence Carlyle currently hold a 23.7 % stake in the company.
Repco Bank, the promoter of the company, is a Government of
India owned cooperative
bank, which was established to help and promote the rehabilitation
of
repatriates from Sri Lanka, Myanmar, Vietnam and other
countries. Its operations
are largely confined in the four South Indian states and the
Union Territory of
Puducherry.
During FY2012, Repco Bank reported a net profit growth of 30.3 %
yoy to Rs. 73cr,
on a total asset base of Rs. 4,875 cr,
which grew by 33.4 % yoy.
Mr. R. Varadarajan is the Managing Director of the company as
well as the
promoter and has 35 years of experience in banking industry. He
is responsible for
the overall strategy and direction of the company.
Most of the key management personnel have healthy experience in
the housing finance and the banking industry and have been associated with the
company for anywhere between about 5 to
10 years.
Details
of the issue..!
The IPO comprises an issue of fresh equity shares of 1.57cr of
face value Rs. 10
each
to the public, with a reservation of 0.02 cr equity shares for
subscription by eligible
employees. The issue constitutes 25.3 % of the post-issue
paid-up capital. The price
band for the issue has been fixed at Rs. 165-172 per share, valuing the company at
Rs.1,026 cr - Rs.1,069cr.
REPCO HF intends to
utilize the proceeds to augment its capital base, so as to meet future capital
adequacy requirements.
As of September 30, 2012, its CRAR stood at 15.9 %, much above
the regulatory minimum of 12 %.
Post-issue, the shareholding of the promoters in the company
will fall to 37.4 %
from the current holding of 50 %.
Review by
Vaibhav Agrawal
022 – 39357800 Ext: 6808
vaibhav.agrawal@angelbroking.com
Sourabh Taparia
022 – 39357800 Ext: 6872
Sourabh.taparia@angelbroking.com
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